Description

On July 17, 2009, Zappos.com, a privately-held online retailer of shoes, clothing, and other soft-line retail categories, learned that Amazon.com, a $19 billion multinational online retailer, had won its Board of Directors' approval to offer to merge the two companies. Amazon had been courting Zappos since 2005, hoping a merger would enable Amazon to expand and strengthen its market share in soft-line retail categories. While Amazon's interest intrigued Zappos' senior executives, they had not felt the time was right--until now. Amazon's offer-10 million shares of stock (valued at $807 million), $40 million in cash, restricted stock units for Zappos' employees, and a promise that Zappos could operate as an independent subsidiary-was on the table. Zappos' financial advisor, Morgan Stanley, estimated the future equity value of an IPO to be between $650 million and $905 million; this estimate skewed the Amazon offer-at least in financial terms--toward the high end of Zappos' estimated market value. Hsieh and Lin, Zappos' CEO and COO, respectively, knew that much of Zappos' growth, and hence its value, had been due to the company's strong culture and obsessive emphasis on customer service. In 2009, they were focusing on the three C's-clothing, customer service, and company culture--the keys to the company's continued growth. Hsieh and Lin had only a few days to consider whether to recommend the merger to Zappos' board at their July 21 meeting.

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Leader 360 provides an overview of the leadership style for a particular business leader covered in the related case study. Delivered entirely online, each Leader 360 is a compilation of publicly-available content prepared by an experienced editor. This Leader 360 provides an overview of Tony Hseih's leadership style from different perspectives between 2008-2013. This resource includes questions for in-class discussion or to assign to students as homework, as well as a list of freely-available articles, videos, interviews, and more, to illustrate the various perspectives on the business leader. Related Case: Zappos.com 2009